Job applicants motivated by compensation claims not protected by EU discrimination law

In Kratzer v R + V Allgemeine Versicherung AG, the ECJ has ruled that a job applicant was not entitled to discrimination protection under EU law where the motivation behind the application was to bring a claim and obtain compensation, rather than a genuine desire to secure employment.

Background law

EU law, and, in turn, the Equality Act 2010, does extend discrimination protection to job applicants. The Equality Act 2010 provides that employers must not discriminate against or victimise a person:

in the arrangements it makes for deciding to whom to offer employment;

as to the terms offered; and/or

by not offering employment.

In Germany, the "General Law on Equal Treatment" enshrines very similar protections into German law. It also provides that a victim of discrimination is entitled to claim compensation for non-pecuniary damage.

Facts

The employer, AV, was a large insurance company. It advertised for trainee positions for graduates with very recently-completed (or about to be completed) degrees in specified fields (including law). Law graduates also needed to have either employment law or medical law knowledge.

Mr Kratzer was an older job applicant, rather than a recent graduate. He was a lawyer. However, he had not recently completed his degree and he did not have the formal employment law or medical law knowledge. His application was automatically rejected.

Mr Kratzer complained to AV seeking compensation for age discrimination. AV responded and said the rejection letter had been automatically generated and they would like to interview him. He said he would only be prepared to meet them after they had paid him 14,000 Euros as compensation for discrimination. AV did not do so and he went on to bring age and sex discrimination claims, seeking a total of 17,500 Euros compensation.

The claim was dismissed at first instance and on first appeal. Mr Kratzer appealed to the Federal Labour Court who referred to the ECJ the question of whether discrimination protection applies to an individual who has made it clear that they want the status of "job applicant" in order to bring a claim for compensation. The German Court asked whether this amounted to an abuse of rights under EU law.

Decision

The ECJ decided that where an application is submitted with the sole purpose of the entitling the individual to claim compensation for discrimination they will not come within the scope of the relevant EU Directives (the Framework and Equal Treatment Directives).

The Court looked at the wording of the Directives and it was clear that protection for job applicants was intended for those "seeking employment". An individual making a job application with a view to obtaining compensation is not "seeking employment" and could, therefore, not qualify for the protection. Such an individual would not have the right to be claim protection or compensation and they would not have been the victim of discrimination. The Court also noted that it was settled law that EU law cannot be relied on for abusive or fraudulent ends.

Comment

This is a helpful ruling from the ECJ and is in line with previous EAT case law which had said job applicants who would not be interested in accepting the role if it were offered could not claim discrimination if their application was unsuccessful.

Of course, the pertinent question for employers is how can you know at the outset that an applicant is "gaming the system" and does not genuinely want the post? The simple answer is that you can't know an applicant's motives. Therefore, employers must ensure that their recruitment processes are free from discrimination. This will enable a forceful rebut claims from people like Mr Kratzer.

In practice this means that employers must:

take care over crafting the job description, person specification and job advertisement;

operate a standardised recruitment process, which allows objective assessment; and

consider minimising any personal information related to protected characteristics on applications forms (e.g. age, sex, race) to avoid unconscious bias occurring amongst those dealing with recruitment. For example, "name-blind" recruitment has recently been introduced across the Civil Service and by a number of private sector employers such as KPMG, HSBC and Virgin Money.